OBJECTIVES: To examine the mortality and medical costs during the first and the 2nd year following the onset of the five liver-related diseases, i.e. HCV infection, compensated cirrhosis (CC), decompensated cirrhosis (DCC), hepatocellular carcinoma (HCC), or liver transplantation. METHODS: Patients with HCV infection and patients who transitioned to the health state of liver-related disease were identified from the National Health Insurance Research Database (NHIRD) during 2008-2010 if any outpatient/inpatient service with primary diagnosis code of 070.54 for HCV infection or 571.5 for CC occurred, or if patients registered in the Registry of Catastrophic Illness with diagnosis code of 571.5 for DCC, 155 for HCC or V42.7 for post liver transplantation. Dual infection patients with diagnosis code of 070.30 for HBV or 042-044 for HIV were excluded. The date that the outpatient visit/admission with the diagnosis code associated with each health state of liver-related disease firstly occurred was defined as the index date. Regression-adjusted medical costs associated with each health state of liver-related disease within 1st year and 2ndyear after the index date were estimated by generalized linear regression model. Excess risks of death for patients with DCC, HCC, or liver transplantation were assessed by Cox proportional hazard model.   RESULTS: 1st year total medical costs associated with HCV infection, CC, DCC, HCC and liver transplantation were NT$25,345, NT$49,793, NT$187,428, NT$197,835, NT$487,816, respectively. The 2nd year total medical costs associated with DCC, HCC and liver transplant were NT$194,016, NT$176,167 and NT$270,009, respectively. Patients in the health states of DCC, HCC and liver transplantation posed higher risk of death with hazard ratio of 14.5when compared with their matched control counterparts. CONCLUSIONS: Liver-related diseases followed by HCV infection impose substantial economic burdens to the National Health Insurance in Taiwan. Effective treatment for HCV infection may imply potential savings to the society.